Coconut Oil

The market for edible oils is expanding. Coconut is one of the most popular types of oil along with vegetable, rapeseed, sunflower and olive oil.

Vegetable/rapeseed and olive oils are bought by about four in ten people, while a third buy sunflower oils. Demand for coconut oil has grown rapidly in recent years, although it is still only purchased by 7% of consumers. 2017/18 saw demand dip slightly, although only time will tell if this is a trend.

The changing market of coconut oil

The market has, for many years, been primarily made up of smaller firms offering raw, organic coconut oil, and it is these companies that top our table.

However, now that they have smelt blood, bigger companies have come for their share of the prize, with most of the major supermarkets now offering their own ranges. Smaller companies have therefore begun to see their market share erode somewhat in recent years as it is eaten away by bigger players offering cheaper versions.

Table highlights

Low wages for coconut farmers is a major problem in this market, as examined in more detail opposite. Lucy Bee and Tiana Fair Trade Organics topped our table, offering fair trade coconut oil.

The following companies received Ethical Consumer’s worst rating for likely use of tax avoidance strategies: Asda, Archer Daniels Midland, KKR, Lidl, Marks & Spencer, Mitsubishi, Tesco, and Waitrose.

UK demand for coconut oil has gone coco nuts

In recent years consumers have gone, well, nuts for coconut oil. In 2014, UK consumers spent just under £3.4m on the stuff; but, by 2017, that figure had reached about £25m.28 Led by the celebrity vanguard, the pied pipers of our modern age, we have begun using this supposed superfood for almost everything imaginable: as cooking oil, a moisturiser, a hair-care treatment.

It has even been promoted by one celeb as a lubricant for the bedroom and as a primordial mouthwash. Thus spoke Gwyneth Paltrow: “It’s supposed to be great for oral health and making your teeth white…it’s an ancient, ancient technique. I read about it on the Internet.”

The many claims to remarkable health benefits have been met by statements that coconut oil may not be a healthy choice, largely on account of its high saturated fat content. In 2018, Karin Michels, an epidemiologist at the Harvard TH Chan school of public health, said in a lecture that coconut oil was “one of the worst things you can eat” and was as good for your well-being as “pure poison.”

Strong statements such as these, casting doubt over this now-sacred oil, potentially explain the recent contraction in UK demand, in which spending dropped 12% in the period April 2017 to April 2018, to just under £22m.

Poor coconut farmers 

Indonesia and the Philippines are the world’s leading producers of coconuts, producing 18.3m tonnes and 15.4m tonnes respectively in 2018. The sector is primarily made up of small-scale farms, which are estimated to account for about 95% of production.

Many of the farmers who grow coconuts live in poverty. In the Philippines, coconut smallholder farmers are some of the poorest households in the country. 60% of them live below the poverty line and earn little over a dollar a day. They are also, according to the Grameen Foundation, "among the least resilient in the face of environmental and economic shocks, such as natural calamities, market volatility, and crop failure."

Fat cats profiting off of the coconut oil industry

The slim pickings earned by small-scale farmers are in stark contrast to the profits made by those at the other end of the supply chain. For example, Optima Raw Virgin Coconut Oil was previously owned by KKR & Co. Inc., a private equity firm of colossal proportions, and is now ultimately owned by Nestle.

In 2018, the firm’s four highest-paid executives took home a total pay packet of $186m between them; although this figure appears almost modest in comparison to the $515m that they trousered the year before.

In order to be sure that farmers are getting a fair price for their coconuts, we recommend buying from a company that sells Fairtrade coconut oil, such as Lucy Bee or Tiana Fairtrade Organics.

You will find that most of the companies in this guide sell organic coconut oil, the only exceptions being KTC, Pura and Asda, so it is relatively easy to find coconut oil that has been produced without chemical products.

How do cooking oils compare?

So, which type of oil should the ethical consumer buy? We would argue that the main issue is not which type of oil but, rather, which brand.

There are, however, some factors that may influence your decision on type. When it comes to greenhouse gas emissions, the difference is not that significant, particularly as oil is itself likely to be a very small portion of your carbon footprint, although coconut oil produces the lowest emissions and olive oil the highest, as shown:

If you are wanting to buy from UK farmers, then rapeseed is really your only option, although supplies of organic UK rapeseed are few and far between. Generally speaking, the vegetable oils rapeseed and sunflower oil use the most pesticides and fertilisers, but this can be avoided through the purchasing of organic oil.

The environmental impact of five different oils

The table above gives an idea of the typical environmental impacts in the production of five crops used to produce widely used oils.

Fertilisers are generally used for all crops but are relied upon least in the production of coconuts and palm fruit. The production of coconuts and palm fruit also requires extremely few pesticides. This explains why organic coconut is so widely available.

Olive production generally uses a notable amount of pesticide, but this figure is relatively low in comparison to the amount used in the production of rapeseed and sunflower oil. Organic rapeseed and sunflower oils are available but are less common than organic olive or coconut oils.

It could be deduced from this table that the oil with the least environmental impact is palm oil, due to its high yield and low amounts of fertilisers and pesticides used. There is some truth in this, and its high yield is one reason, alongside its versatility, why it has been favoured by so many companies.

However, thus far palm oil has been produced in an incredibly unsustainable way, resulting in the mass destruction of habitat.